People who contribute to EPFO for 10 years continuously become entitled to a pension. This means that after retirement they can get a pension from EPFO. The amount of pension is decided based on their contribution. You can take a pension from EPFO at the age of 58 years. However, if a person wants to take a pension early, then he gets this opportunity at the age of 50. But the sooner you take a pension from EPFO, the more loss you will incur. Here understand the rule of EPFO regarding Early Pension.
Early Pension Rules
According to the rules of EPFO, if you have contributed to EPFO for 10 years or more and you are entitled to a pension, then you can claim for pension after retirement. But if you want to take advantage of a pension early, then at the age of 50 you get a chance to claim for Early Pension. But there is a loss for you in this. The earlier you withdraw money from the age of 58, the lesser will be your pension at the rate of 4% for each year.
Suppose an EPFO member claims for pension at the age of 56, then he will get 92% (100% – 2×4) of the basic pension amount. This means that the investor applied 2 years ago, so 8% has been deducted from his pension amount. Similarly, if you claim at the age of 55, you will get 88% of the basic pension and if you claim at the age of 54, you will get 84% of the basic pension as a pension. The pension will be reduced by 4% every year.
How to claim for Early Pension
To get an Early Pension, you will have to fill out the Composite Claim Form and select the option of 10D. If you are less than 50 years old and want to take a pension, then you will not get this opportunity. In such a situation, if you leave the job, you will only get EPF funds. According to EPFO, the right age to receive a pension is 58 years. At the same time, for early pension, the minimum age must be 50 years.
If you have worked for less than 10 years
If your job tenure is less than 10 years, then you are not entitled to get a pension from EPFO. In such a situation, you have two options. First - If you do not want to work, then you can withdraw the pension amount along with the PF amount, that is, you can make a full and final settlement. The second option is that if you think that you will join a job again in the future, then you can take a pension scheme certificate. In such a situation, whenever you join a new job, you can link the previous pension account to the new job through this certificate. With this, whatever is a shortfall in the 10 years of a job, you can complete it in the next job and become eligible to get a pension at the age of 58.
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